According to a recent study by Deloitte not only is there a significant amount of information on the web to aid purchasing decisions, but these reviews also shape company reputations. Well, that’s really no big surprise to readers of this blog. According to the survey:
62% of consumers read consumer-written product reviews on the Internet. Of these, 82% say their purchase decisions are influenced by these reviews, either influencing them to buy a different product than the one they were initially considering or confirming the original purchase intention. In addition 69% of consumers who read reviews share them with friends, family or colleagues, thus amplifying their impact beyond online.
What I did find interesting is this quote from Deloitte’s Pat Conroy in their press release:
“This increasing market transparency can adversely impact the margins, market share and brand equity of consumer products companies,” said Pat Conroy, vice chairman and US consumer products group leader at Deloitte & Touche USA LLP. “In the past, clever marketers and advertisers shaped brands, but now consumers are increasingly empowered, everyone has a voice, and information and opinions are instantly dispersed. Consumer product companies need to determine how best to capitalize on this new landscape. Clearly, there will be consequences for those who don’t.”
Is it really ‘increasing market transparency’ that is adversely impacting the margins, or is it a lousy product or a lousy customer experience? Marketing transparency has always been there, it just happens much faster these days as the result of all the online tools that speed up and increase access to word-of-mouth. Companies are now faced with developing better products and better experiences because “the word” can get out there faster and be “heard” by more consumers than ever before. Marketers need to understand that shaping brands is now a “partnership” with current customers where their voice should be heard, because potential customers are certainly listening.
This reminds me of the quote by Morris Hite in 1988:
“Nothing will put a bad product out of business faster than a good advertising campaign.”
So maybe know we need to change that quote: “Nothing will put a bad product out of business faster than honest word-of-mouth.” So companies take note – do your customer research, create relevant products and great customer experiences, and welcome this market transparency. It could be the best marketing campaign you ever created.